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Vic and Marcus return to break down the implications of the massive bill just passed by the Trump administration. They examine its sweeping impact on Medicaid, hospitals, and insurers, discuss how the new QSBS 2.0 changes benefit VCs, and question the future of nonprofit healthcare. The episode also covers market trends including meme stock speculation, private equity distributions, a surprising acquisition by Samsung, and Robinhood’s push to tokenize private equity. Finally, they warn about ...
Vic and Marcus return to break down the implications of the massive bill just passed by the Trump administration. They examine its sweeping impact on Medicaid, hospitals, and insurers, discuss how the new QSBS 2.0 changes benefit VCs, and question the future of nonprofit healthcare. The episode also covers market trends including meme stock speculation, private equity distributions, a surprising acquisition by Samsung, and Robinhood’s push to tokenize private equity. Finally, they warn about the growing financial risks in senior care communities.
Links
5:00 - Stock Funds Rose 10.1% in Second Quarter WSJ
6:17 - 8:17Meme Stocks and YOLO Bets Are Back and Fueling the Market’s Rally WSJ
8:17 - 8:57Steady Hiring Added 147,000 Jobs to U.S. Economy in June WSJ
8:59 - Trump Delayed Reciprocal Tariffs After Bessent Wanted More Time on Deals WSJ
10:51 VC Fund Performance Q1 2025 Carta
14:43 H1 2025 market overview: Proof in the pudding Rock Health
15:47 QSBS 2.0 is Here LinkedIn
22:11 - How the reconciliation bill will shake out for hospitals and the healthcare industry HFMA
32:54 - New taxes to hit hospitals as a result of the budget reconciliation bill HFMA
39:56 - We’re Leaving Delaware, And We Think You Should Consider Leaving Too A16Z website
43:43 - More Pressure Mounts on Health Insurers as Costs Continue to Rise WSJ
44:30 - HCSC launches rebrand for its Medicare unit as 'HealthSpring' Fierce Healthcare
45:31 - CVS Omnicare ordered to pay $949 million in government fraud case Healthcare Dive
47:36 - Samsung to acquire digital health firm Xealth Healthcare Dive
49:40 - Symplr acquires AMN Healthcare's staff scheduling software for $75M Fierce Healthcare
50:38 - Merck to Buy Verona Pharma in $10 Billion Deal WSJ
51:20 - She Paid $1 Million to Join a Senior Facility. Its Bankruptcy Wiped Her Out. WSJ
57:18 - Robinhood Wants to Redo Wall Street on the Blockchain Gizmodo
1:02:03 - SEC Chairman Paul Atkins on public vs. private markets CNBC
1:03:36 - Making America the Crypto Capital of the World X
1:06:01 - As an M.D, here's my 100% honest opinion and observations/advices about using ChatGPT Reddit
1:09:01 - Elon Musk’s xAI launches Grok 4 alongside a $300 monthly subscription TechCrunch
1:14:28 - Microsoft Touts $500 Million AI Savings While Slashing Jobs Bloomberg
1:15:32- Meta Hires Top Apple AI Expert, Continuing Zuckerberg’s Recruitment Push WSJ
1:17:23 - Zuck's Eleven Spyglass
Every week, healthcare VCs and Jumpstart Health Investors co-founders Vic Gatto and Marcus Whitney review and unpack the happenings in US Healthcare, finance, technology and policy. With a firm belief that our healthcare system is doomed without entrepreneurship, they work through the mud to find the jewels, highlight headwinds and tailwinds, and bring on the smartest guests to fill in the gaps.
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Thank you.
Alright, uh, we are back and apologies for missing last week.
That's all on me.
Um, you know, I was supposed to record on Wednesday night.
Mm-hmm.
And kind of two things came up.
The first was I had, you know, sort of a family health thing that I needed to sort of focus on and prioritize.
But the second thing was that I was, I was just realizing the bill wasn't passed yet.
You know what I mean?
And I was like, I don't wanna record a show before the bill gets passed.
And then it got passed on Thursday, right?
Like in the, well, I think, uh, middle of the night or something.
Yeah, yeah, yeah, yeah, yeah.
Whatever.
No, no, no, no.
He signed it Friday, Thursday was the third.
Is that right?
Yeah.
Yeah.
Passed on the third.
Right.
Passed on.
Passed on the third during the day.
Right.
Yeah.
I remember.
'cause I was watching TV when it happened.
Mm-hmm.
Um, and so, uh, you know, and, and it happened right before I had to go pick up my girl from the airport.
Yeah.
And so I was just like, well, I guess we're not gonna have a show.
Yeah.
Uh, so apologies to anybody.
But at the same time, the truth is that, uh, it needed some time for the analysis to kind of roll out.
Yeah.
Huge Bill.
You know, there was all sorts of emotions about it for very good reason.
Um, it's a, it's a pretty hard bill to make sense of, like if you're, you know, if you're trying to sort of figure out what the through line is.
Um, it feels like the only through line is more money for the rich people and let's spend all the money on ice.
Um, we're, we're gonna dig more into it in here in a little bit, but I mean, I, you can't say it's a deficit cutting bill.
Right.
It's not.
Um, yeah, I mean, I think it is Trump delivering on some, some decent number of his campaign promises, and that that's what it is.
It doesn't, it doesn't reduce, the deficit does it's gonna be bad for the healthcare industry and in every front.
Well, well, I, I guess, I guess the, I guess the point is that, um, if you were going to, if you're going to do something so incredibly, uh, impactful to the healthcare industry and to the recipients of, of Medicaid, right?
If you're gonna do something like this drastic, you would hope that the clear goal and the clear through line here was that you were also going to cut the deficit.
Mm-hmm.
You know, 'cause at least you could sort of make the call.
That, Hey, we have to get the deficit under control, the number, you know, we spend so much money on healthcare and this is an awful, horrible thing to do.
Right?
Right.
And in fact, that was not the posture.
I mean, you know, vice President Vance was basically saying the, the Medicaid stuff is a rounding error.
The most important thing here is ice.
Right.
You know, it was, so I, I, I think on Thursday, I, I was not in a good place to even talk about this, quite frankly, because it just felt that it, it, the way it was being positioned was just kind of peak cruelty, um, you know, as far as I was concerned.
Um, so I'm glad I have a week Yeah.
To sort of let it, let it pass, let the analysis kind of come out before we actually talk about it.
Yeah.
You know?
Yeah.
Yeah.
I think that's fair.
I mean, there's a lot to dig through.
I'm still not sure we have all of the details, but we have a lot.
We have a lot of 'em.
No, they're emerging.
Yeah.
You know, and we'll point out a couple of things.
We, we found out, like I found out yesterday, I was like, holy.
Cow.
This is, this is crazy.
Uh, anyway, um, on, on, on a bright note, Nashville Soccer Club is the best Yeah.
Soccer team team in America right now.
I mean, yeah.
It's kind of fun to be a, a Nashville SC fan right now.
Yeah, yeah.
Yeah, man.
Yeah, I mean, we, we, uh, we're in the semifinals of the open cup after just a spectacular comeback win at home last night against DC United.
They had us down two nil.
We ended up finishing the game five two.
Yeah.
With three, like SportsCenter highlight goals to wrap up the game.
Yeah.
Just crazy.
Um, so that is a lot of fun right now.
It is a lot of fun to be a Nashville SC fan.
So, uh, for any of the listeners who are also Nationale fans, I hope you're enjoying this 'cause, uh, these kind of moments don't, don't happen all the time, you know, it's really, really fun.
Really, really fun.
This whole season looks pretty good though.
Yeah, yeah, yeah.
I mean, you know, we're, we're past the halfway point.
Now we're through the international break.
Came back and like, I. I think probably more impressive than we were in the first half.
Mm-hmm.
You know?
Yeah.
So even, even stronger after the break.
So it's, it's, uh, yeah, it's pretty, pretty great, man.
Yeah.
Pretty great.
Uh, anything else before we, before we, no, I don't think so.
All right.
Let's dig into it.
Let's dig in.
All right.
First thing we're going to start with is the economy as always, and, uh, you know, we are in a KS shaped economy, right?
Yeah.
And so, um, we're, we're simultaneously gonna talk about some incredibly hard things that are gonna happen for the least of us socioeconomically.
Mm-hmm.
But at least our stocks are up.
Right.
10.1% increase in stocks in the second quarter.
Yeah.
So the, um, I forget what he calls 'em, but Trump's tariff plan was released.
Basically on April 1st, I think it was April 2nd, so the entire second quarter was.
Confused by Trump, then, you know, terrorists, then no terrorists then delay.
We will have a story about that later.
But overall, the, the stock market's up 10% in a quarter, which is, it's ridiculous.
Incredibly good.
Yeah.
It's ridiculous.
Yeah.
It's, you know, so, uh, yeah.
I mean, but again, I, I, I, I feel like now, especially after this bill, right, it's, it's, it's even more important that we talk about the.
The K shaped economy.
Yeah.
And, and just how that Yeah.
Stock market is not the overall economy.
No, not, not even close.
There's a of, a lot of Americans don't have, don't own stock.
Not even close.
Like when we talk about stocks, we're talking about the asset holders.
Yeah.
And that's, that's, you know, those of us who are doing well, right?
Yeah.
Those of us who are doing well, even crazier, and I did not know this until you brought this article up.
This is Wall Street Journal meme stocks and YOLO bets are back and fueling the market's rally.
So we haven't really seen this since COVID times.
Mm-hmm.
Yeah.
Um, but we're back to investing in unproductive companies.
Um, so there's a whole bunch of companies out there that are unprofitable.
Uh, in this article.
They say, forget the magnificent seven investors are now learning to love the unprofitable 8 58.
Yeah.
Uh, but these, these money losing companies and these meme stocks are starting to draw a lot of, uh, investment again, uh, sort of at the, at the highest clips that they have since 2021.
Yeah.
And I think this is a, a symptom of the khap economy.
Like if you are the American dream of working hard and getting ahead is not very realistic now.
And so I think people are basically gambling of, can they get, uh, some kind of inside track from a Reddit, you know, forum or something, and then make a bunch of money trading AVA technologies.
I don't know what that is, but, um, it's up, it's up 300% in the last two months.
Yeah.
Um, and that's fine as long as you, you're tips work, but, but then it's gonna crash again.
Sure.
So, um, I understand why people do it, but it, it's, I fear it won't end well.
Yeah.
And the same for exactly the people that you know, I.
Are not gonna be able to sort of roll with a, a loss like that.
Yeah.
Well, I mean, you're not doing it for fundamentals.
You're doing it for speculation and momentum and because other people are in Yeah.
Somebody's going to holding it back.
Right.
Exactly.
Somebody loses here, right?
Yes.
When there's nothing underneath it.
Yeah.
So, um, you know, that's when the music stops.
It's hard to know, but, but it's, there's gonna be people that don't have enough money to be gambling like this to lose money.
Yes.
Yes, exactly.
Uh, jobs came in and, uh, 147,000 jobs, uh, were added to the economy in June, basically flat month over month.
Mm-hmm.
Uh, job, uh, additions.
So, I mean, good-ish.
Yeah, it's fine.
I mean, it was positive, which is Yeah.
Good-ish.
I mean, the, the unemployment rate went down from 4.2 to 4.1%, but the reason is that.
People stopped looking for jobs that were in the labor force, and now they're didn't get a job, they just are not in labor force anymore.
Mm-hmm.
So that's not really a good reason for it to go down.
Right.
Um, but, but it went down, so I don't know.
Yeah.
It's, it's, it's okay.
Mm-hmm.
Mm-hmm.
Trump delayed reciprocal tariffs after Besson wanted more time on deals.
So this kind of resurged after mm-hmm.
Last week was all about the bill.
Yeah.
And this week has been all about tariffs.
Uh, so we're back talking about tariffs and, uh, that he kind of rolled out a new slate of tariffs this week.
Um, you know, Japan got a letter.
Yeah.
Right.
Uh, you know, um, all the way to Myanmar, you know.
Right.
Sort of at the, I think it was the 40%.
Yeah.
The original pause was gonna end maybe on.
July 10th or July 15th or something.
Mm-hmm.
So Trump delayed until August 1st and sent up several letters to countries.
I'm hopeful that they get negotiated deals done.
There's a lot of work to do even before, between now and August.
But I mean, I mean, no, no rest, right?
Like right off of the bills.
Oh, yeah.
Yeah.
Not even, not, not even like a week, like Right, right.
Back into this.
Yeah.
You know, so, just, just, I mean, it's one thing you could say about this guy.
He, he puts new things on the table at a Oh, yeah.
Ridiculous.
It's, it's, it's not the speed, it's the relentlessness of them.
Mm-hmm.
I mean, every week it's a, it's another.
Really, really, really big thing.
Mm-hmm.
And, and I think that that, um, the markets at this point have sort of realized that's what it is, and you're just gonna have to do business in that environment.
Yeah.
Right.
And so, you know, you think about the fact that the markets went up 10% over the course of the second quarter, we're dealing with all that volatility.
Right.
You know?
Mm-hmm.
Um, it, it was, it was certainly after, you know, the, the big shock that came in the first 30, 45 days.
Right.
Yeah.
You know, but still, I mean, a lot of volatility throughout the, the second quarter and, and.
The market found a way to persevere.
Yeah.
You know, that's right.
Carta came out with their first quarter, uh, state of the market, uh, always a great way to sort of understand what's happening in the VC industry mm-hmm.
Because of their significant percentage of funds that they manage.
Yeah.
It's a, it's certainly statistically, you know, relevant.
Um, the highlights from this quarter, you know, still hard to find DPI 37% of funds in 20 20, 20 19, and, uh, 30% of funds in 2020 had generated any amount of distribution.
So DPI, just, for those who are not initiated, basically means distributions like so.
Right.
In our industry.
It's kind of two things.
One is book value, and you know, that's T-T-V-P-I.
It's, it's kind of like, uh, you know, yeah.
Like how much have the assets you invested in grown or grown or shrunk in size?
Yeah.
V versus versus the capital that's been invested.
Right, right.
Um, but DPI is distributions.
That's, that's what you can eat, right?
Yeah.
That's much more real.
That's just money going back into your account.
Yeah.
And so, you know, a lot of people are, are flaunting TVPI, but very few can flaunt DPI.
Right.
So that's, so this is important, uh, because this means that, uh, limited partners are still not recouping their funds, right?
Yes.
Um, smaller, another highlights, smaller funds have grown more common.
Um, this to me was a, was some great analysis to sort of see how, how the, how the landscape is changing.
Um, they have a really cool chart and, and it shows that, you know, in 2024, the majority, uh, of, of any cohort, the majority of funds, 42% of funds, um.
Were 1 million to $10 million funds.
Um, and then if you combine that with funds that were 10 million to 25 million, it's just shy of 70 70% of the funds.
Yeah.
So, I mean, that's not what this industry so huge needs to be from 10 years ago.
Yeah.
Yeah, yeah.
Yeah.
So, so lots of little funds out there.
Yeah.
You know, and if it's, if it's a one to $10 million fund.
It's a single gp.
Yeah.
You know, you might, that's what I'm managing right now.
Right?
Yeah.
And then you might be able to eke out a two GP fund at 25.
Yeah.
You know, 25 is probably the line mm-hmm.
Where you're a two GP fund, and then, you know, when you get above that, then you can start to add more partners.
Right.
So that means the vast majority of funds out there have a single partner.
Yeah, that's right.
Or solo GP funds.
That's right.
More than half are or have to be a single partner.
Yeah.
Because it's not, yeah.
And, and look, I mean, I, I think that there, I, there's a couple of great things about that, right?
Like, like one smaller funds, uh, you know, much more focused, have to be much more disciplined.
Mm-hmm.
Yeah.
Um, in general, they perform better.
They, yeah.
Yeah.
Because they're not, they're not just, you know, throwing money out there everywhere.
Right.
They limited funds.
You have to really think about your portfolio construction, how are you're gonna allocate your, your checks, what you're gonna do from a pro rata for your, you know, right.
Follow on investing.
So you, and also, this probably means that, that there are many more funds in the market, which means there are many more emerging managers.
Mm-hmm.
Which means we are seeing diversification of the venture capital industry.
So this likely is a very, very good thing.
Right.
It also means that there are probably new LPs into the game, you know, with all these new funds.
Mm-hmm.
We're probably seeing a diversification of LPs.
So I, I think there's a lot of good here.
It's just an interesting thing to sort of see, you know, over the course from 2020 to 2024, you can see that combination in 2020.
Uh, for those who are not watching, um, 25% of the funds were one to 10000024% of the funds were in the 10 to 25 million.
So we've basically gone from 50% to 70% Right.
Over the course of the last five years.
That's a pretty big shift.
Yeah, it used to be that that 25 to a hundred range was sort of where most of the early stage funds were.
Yes.
Lived.
And now it's definitely shifted.
Smaller, smaller and fewer gps.
Yeah.
Yeah.
Yeah.
Um, and then, you know, they say that, uh, the, the TV pi, you know, that that total value number that's not actually distributed, um, slight positive momentum, um, which is, which is good.
Uh, so, you know, kind of steady as she goes.
Uh, for, for the overall VC industry, rock health put out their first half, 20, 25 market overview.
And, um, I think to me, the highlight here, um, not, not so much sort of the, the deal count, uh, but the fact that m and a, um, has picked back up mm-hmm.
In, in, in the digital health space.
So we are, uh, kind of on track to double last, last year's number of m and a deals.
Uh, and I think that's, yeah, that's really important.
That's really, really good to see.
Yeah.
We need to have a process where good companies can be sold for a fair price, right.
Just 'cause otherwise the whole, the whole system gets kind of gummed up and you can't, can't return money to investors and then they can't invest in new funds and start the whole process.
Yeah.
Yeah.
So, you know, we, we still are, you know, not booming on the IPO side.
Mm-hmm.
But the m and a side is quite frankly where most of us, you know Yeah.
Get, get to our distributions and, uh, it's, you know, if you can two x year over year, the number of MA Yeah, that's great.
You know, uh, transactions that are happening, I'm all for that.
Yeah.
That's great news.
Right?
Great news.
Alright.
And then, and then talking about things that we didn't quite expect, you know, because who's gonna be talking about this when you're talking about, you know, all the, the brutal cuts to Medicaid?
Yeah.
I didn't even know this topic was part of the bill in the bill at all.
Well, this have to have a 900 page bill, you know, like there's a million things in there you don't even know about.
But, and, and I do think that this, you know, it's, it's hard to celebrate something like this.
Against the backdrop of mm-hmm.
Of what has happened with Medicaid and, and, and the ICE stuff and, and things like that.
So it's, that's, it's difficult.
Um, but in our industry, I think we have to report on it, right?
Yeah.
So, yeah.
So in the vc, this is gonna be, this is a big Yeah.
Change Yeah.
In, in the VC industry.
Um, you know, when you think about why an investor would invest in venture capital, which is very illiquid, right?
You know, you put your money in a venture capital fund mm-hmm.
You don't get it out until the distributions come out.
You can't pull it.
Right.
You can't call it, you have no access to it.
Right.
Um, and so why would you do that?
So the, the primary top line reason you would do it is because the venture capital industry promises, you know, superior returns.
Yeah.
And there was certainly a period of time where that was true.
You know, because of the performance of the stock market over the last five years, like it's getting harder mm-hmm.
To beat, it's getting harder on average for VCs to beat the market.
Right.
So you really have to be in that three and a half X and up MOIC to like generate an, uh, internal rate of return to be worth tying it up to be worth Ill worth the tying up in illiquid front.
Right.
But like, one of the hacks, and this is specifically true for early stage venture.
Mm-hmm.
Right?
One of the hacks that adds another reason why investors would come in is there, there are some tax benefits, um, that, that come along with investing in venture firms, that are investing in small businesses, small C corporations.
Right.
And that's, that standard is called, um, QSBS qualified Small Business Stock.
And so you really wouldn't know this unless you're in the venture industry.
This is not something you would know.
Um, but basically, um, if a, uh, if you invest in a. Small business, C corporation, um, and you hold that stock for five years.
Once the company sells and you get your proceeds up to a certain amount, you don't pay taxes.
Yeah.
No capital gains, no capital gains taxes.
So that's a huge benefit.
That's huge.
Okay.
Right.
That's a ridiculous benefit.
So this, this, that's been true for 10 years.
Yes, yes, yes.
Q-Q-S-B-S has been a, a, a big deal and very positive for the VC industry.
So now like I. This is one of the things that everyone was asking, like with Trump, what's gonna happen with Qsb s you know, because he's been pretty anti the, the carried interest thing.
Right?
So you, you didn't know whether or not this was going to be Yeah.
Part, part of the things he felt should, so actually this went the other way.
So Qsb S 2.0, Chris Harvey is, um, uh, a pretty popular, um, uh, emerging fund lawyer.
Mm-hmm.
Uh, he's got a great substack and you know, I've, we've linked here to his, um, his LinkedIn Yeah.
Uh, uh, newsletter.
Um, but he basically lays out QSBS 2.0, which basically has a new tiered holding period.
So, as I said before, five years, you'd have to hold in order to have no, no taxes.
Now they've got tiers three, four, and five years.
And if you, if you sell 'em three years, 50%, uh, right.
Tax, tax free.
Right.
50% of the proceeds are tax free.
Um, four years, 75% I think, and then yeah, that's, and then five years, a hundred percent.
So.
You know, that actually incentivizes you to offload something earlier because yeah, you might pay some more taxes, but your IRR is higher, right?
'cause you're getting the, the capital back quicker.
Right?
So that's, that's a plus if you're in our industry, um, per taxpayer caps.
So before the max amount that you could get in proceeds that would be tax free before you start paying capital gains tax was 10 million.
Now it's 15 million.
Yeah.
Uh, and then the, the size of the company, so this would, generally speaking, I mean Vic's got a more technical definition for this, but the pre-money valuation, you know, what, what the company's worth when you invest in it.
Yeah.
Before it was 50 million.
Um, for, just for context, Vic and I basically never invest in companies Yeah.
That are worth more than two In 25 years, I haven't done.
I mean, I've done follow on rounds above 50.
Right.
I've never done an original round.
Right, right.
Even close to 50.
So now they've bumped up to 75 million.
Right.
So, so now, I mean, basically you can invest in a firm that does series B investing.
Yeah.
And I think you, you would, yeah, you would be in the pocket now, 75 million.
I mean, you know Yeah.
That's, that's series B territory, right?
Yeah.
Yeah.
So I think it's all positive in the sense it's gonna encourage investment in early stage, high growth companies.
High growth companies.
Yes.
And you can obviously, like we're talking about it, you can do it through a phone, you can be an LP and it gets, we, we passed it through on the K one to you so you don't have to worry about it.
Uh, or you can be an angel investor and invest directly and you gotta file the paperwork and everything correctly.
But, um, it's across the board and it'll encourage and more investment in early stage things, which is great.
Good for the VC industry.
Good for our investors.
Good.
Overall, I think it is often true that.
We will hold it for five years.
But I love the optionality that if, if you can sell something in three, it might be, might be worth it.
You can choose, you can decide not to sell.
You still wait five years and get the a hundred percent.
Um, there's nothing about these changes that isn't a hundred percent positive, I think.
Yeah.
And to me, you know, um, Chris Harvey in this, in this letter, he, uh, he thanks the Carter policy team, he kind of credits them with, with really working.
Yeah.
Uh, you know, um, and to me this is just sort of one of those, uh, symbols of the partnership that is big tech in the GOP.
Mm-hmm.
Right.
You know what I mean?
Uh, this, this is, um, yeah, yeah.
Just you, you, you, you can see that that big tech has found a way to actually, and, and, sorry, I don't mean big tech.
I mean, you know, uh, the VC world, um, has found a way to actually effectively lobby now.
Um, yeah.
So it's, it's, uh.
It's good.
I mean, it's, it's good for the upper side of the K.
Yeah.
Now let's talk about the lower side of the K. Yeah.
Right.
Okay.
So I think it is helpful when the Wall Street Journal writes an article breaking down the healthcare cuts.
Right?
Yeah.
Because they're not, they're not super liberal, worried about that.
They're, they're, I think they're mostly conservative, slanted.
If anything, the Wall Street Journal is unquestionably on the, right now, it is not as far right as many on the right would like it to be, but it's unquestionably center.
Right.
Right.
Yes.
It's just not, it's not center left.
It's center.
Right.
Okay.
So I, I think this is a good article Yeah.
To, to start with, as we're talking about what.
This big beautiful bill is doing to healthcare in America.
Okay, so I'm just gonna read the Yeah.
The, the headlines.
Yeah.
Right.
So how healthcare cuts in the big, beautiful bill will affect Americans.
Millions will lose, will lose coverage.
Hospitals uncompensated, work will increase and insurers will lose big business.
Those are the three big points.
Yeah.
That they're trying to communicate here.
Millions will lose coverage.
Hospitals uncompensated work will increase and insurers will lose big business.
So to me that sounds like many citizens lose access to care and the healthcare industry, both sides.
Yeah.
Provider and payer are going to be impaired.
Yeah, that's right.
And it's all largely the same through Medicaid.
Medicaid.
That's where most of the millions of people are gonna lose coverage.
Yes.
That then drives uncompensated care and it knocks people off the, the insured rules.
Yeah.
It's all intertwined.
So socioeconomically speaking the least of us.
Yes.
By definition, right.
Medicaid is for the poor and children.
Yes.
Yes.
So, um, but then it's not equal state by state.
Um, well that's be, well that's because every state has its own relationship with, with, with Medicaid.
With, with Medicaid.
Right, right.
So, but that's an important thing to talk through.
That's why I like this article as well.
'cause Yeah.
'cause it's not the same in.
Tennessee as it is in Oregon.
Yeah.
So it was good to see the Wall Street Journal working with Manat Health because mm-hmm.
I, I've told you, I think they do the best.
Yeah.
Sort of regular coverage on Medicaid and Medicare.
Mm-hmm.
Um, out there.
Uh, so it's great to see them pulling their analysis in and, you know, they, what they do, a great job of highlighting is that the states that were non-Medicaid expansion states are generally on the lower end of the spectrum in terms of change of enrollment.
Mm-hmm.
Um, I, I was actually a little bit shocked to see, uh, Louisiana was, was not, uh, in that cohort that they are act, in fact a Medicaid expansion state, and they are gonna be most impaired in terms of change in enrollment.
So the, the, the spectrum kind of goes from negative five, uh, negative 5% change in enrollment and a little bit lower to 15%, you know, negative change in enrollment and up, uh, on balance.
Across the United States, 10% change of enrollment, um, over the next 10 years.
Yeah.
Right.
So it's gonna affect every state.
Yes.
But there are some states that are gonna be more, effect, more people in this graphic.
More people is what it's referring to.
More people in Oregon, Nevada, and Louisiana.
Mm-hmm.
And Connecticut, I think.
Yeah.
Um, you know, 15 to 18% of, of the enrollment is gonna lose coverage.
Mm-hmm.
Yeah.
Um, hospitals will lose funds, so.
There's a map that is laying out, uh, in the same way the reduction, the projected reductions in Medicaid payments to hospitals, um, over the course of the next 10 years.
And those change in payments go from, uh, negative 8% to negative 24%.
Um, with the blended, uh, number across the United States being negative 18% change in Medicaid payments.
Um, obviously, you know, depending on your payer mix, um, this is more or less impactful.
So safety net hospitals incredibly impactful.
Yeah.
Rural hospital, uh, rural hospitals, incredibly impactful.
Um, nonprofit hospitals.
Pretty impactful.
Yeah, I would say significantly impactful.
Um, and so this is gonna be brutal.
It's gonna be absolutely brutal.
The, the many, many, many hospitals will just simply not be able to operate.
Um, now, um, Murkowski was able to fight to get that, uh, sort of, um, rural hospital support, uh, addendum added in.
Yeah, that's gonna kind of offset this for some period of time, but that's not a long term fix.
Mm-hmm.
Um, and I don't, and I, and I worry about how that gets allocated and, and things of that nature.
So I. You know, um, she tried, uh, from her position to do what she could.
Um, and at the same time she voted for the bill.
Right.
You know?
Yeah.
So she, she, that was probably the negotiation she had to do.
Right.
She was like, you know, they were probably like, if you, if if you want us to agree to this, to this offset you, you, you have to vote for the, for the bill.
Yeah.
Um, she, she looked to be incredibly conflicted and kind of disgusted with herself, um mm-hmm.
In, in the interviews afterwards.
And so, um, it's a dirty game.
Yeah.
I mean, I think that there's a lot of health systems that don't have the profit margins to take this cut.
Yeah.
And so the, I don't know what's gonna happen, but it's gonna be really difficult Yeah.
In, in safety net in rural hospitals.
Yeah.
And I think I'm gonna just get out in front of it 'cause we're gonna continue to talk about this.
We we're, we're largely gonna talk about this from an industry perspective.
Um, I think.
We, we are nowhere close to exhausting the analysis and the commentary on this bill.
Right.
It's such, yeah.
It's such a dramatic bill.
Um, you know, there, there are a variety of different analysis out there that are talking about how many people will die as a result of this.
Mm-hmm.
Um, about about how many, you know, towns will shutter because, you know, the hospital that's the main employer will no longer be there.
Mm-hmm.
Um, we will over time as we get a chance to sort of digest and, and, and make sure we understand and can verify the sources, we will bring those into our Yeah.
You know, analysis on the week over week basis.
But right now, uh, don't anything want to think that we're not gonna talk about the human impact.
Uh, just right now it's, it's, it's much clearer to talk in terms of the payments, um, and the enrollment.
That's, that's much clearer sort of first order impact.
Yeah.
I. That's right.
Yeah.
Okay.
Um, and then, and then enrollments.
So, so we've talked about the, the enrollees mm-hmm.
And how across the country, over the next 10 years is 10% haircut.
Then we just talked about 18% haircut on the, um, Medicaid payments.
Mm-hmm.
Um.
And now talking about, uh, the number of enrollees.
And so you, you don't have to do another negative.
'cause we've already covered that 10% of the enrollees, uh, across the country.
Um, Centene is leading the pack, um, with, uh, 12.96 million Medicaid, uh, uh, insured enrollees.
Um, but ance, 8.86 million, uh, UnitedHealthcare, 7.57 million, Molina, 4.8 million CVS Aetna, 2.4 million.
Um, and so if you just take a 10% yeah, they're all gonna lose lives.
Yeah.
They're all gonna lose lives.
But I mean, in the case of Centene, you know, 1.3 million Yeah.
Lives, I mean, that is, that's a lot of people.
It's a lot of people and it's gonna be Yeah.
A lot of people, a lot of revenue, you know.
Right.
A lot of, yes.
Yes.
Um, and, and you have to think that that.
Based on us looking at the different states and, and knowing that in those states where there's, there was significant expansion, that the decrease will be more significant there.
It could create significant p and l pressure in some of those states where the drop is like, you know, 15, 20% decrease.
Right.
Yeah.
And do they even stay in that market if, you know, if, if, if you, if you lose that many people on the rolls, can you stay in that market?
It's just a question.
Yeah.
I mean, I, I don't know.
I think there, there will be markets that some of these payers leave almost certainly.
Um, I think it also is true that the states themselves are gonna be under significant budget pressure.
Yes.
Which we haven't talked about yet.
But that's gonna then affect all the public services and everything the state does.
Absolutely.
For its people.
Yeah.
I mean, I. I've, I've talked to you about what's happening in New York with mm-hmm.
With, you know, because New York news was, I mean, this was coming plus also, yeah.
All the blue states are getting hit directly in other wa you know Right.
Sort of punitive ways.
And they've already proactively, you know, talked about cutting the, the, not just talked about, but I mean, they're going to, I think by next year, cut the Medicaid a BA rates by 45%.
Yeah.
I mean, you might as well just end a BA for Medicaid in, in New York state.
Well, the providers are not gonna be able to do, they can't live Who can do that?
Right.
Who can take a 45% haircut.
Right.
So, you know, it, it's, there's gonna be so many implications for this.
I mean, I think that's why, uh, in, in, in one way, I'm very glad I didn't do a show last week because, because there would've been no way to, to.
You know, address the gravity with, with the sobriety necessary.
Mm-hmm.
Um, to, to respect the future impact to this country.
I mean, this, this is, yeah.
I mean this is so significant.
Trump's signed into law.
It's law now.
We don't know all the things that are roll out 'cause it's a lot to it, but we're not going back for a year, two, four years at the least.
No.
Alright.
So, uh, Nick HUD at HFMA, um, highlights a couple of additional things, you know, so e even beyond, uh, the enrollment, right?
And, and the payments, uh, changes.
Um, there are other things that are targeting hospitals.
So, uh, executive compensation and, and I think to, you know, the way that I sort of looked at this is this is really focused on not-for-profit hospitals.
Um.
We've had a lot of conversations with Emily about the, the mulling amongst this administration and, and this cohort of the, the GOP across the Senate and House around really questioning, you know, the, the fundamental validity of, of nonprofit hospitals, right?
Like, you know, based on the amount of money that they make, should they be treated as, as, as nonprofit entities?
And you can see this is starting to kind of chip away at that a little bit.
Um, they're now going to tax, um.
Uh, they, they're expanding a 21% excise tax on executive compensation that exceeds a million dollars.
And so, so far that tax has only applied to the five highest compensated employees in an organization in any given year.
Um, uh, plus anyone who's been on the list from a prior year, but now, you know, uh, for these institutions that cannot pay stock incentives or anything like that, um, if you're in that million dollar club, the hospital is now gonna have to pay an additional tax on top of that.
So that's a, that's a bigger hit to the p and l probably is going to impair, you know, keeping people below that million dollar line, which the byproduct of that is, it's, it's less attractive to work in this, it's less attractive to work in this far more difficult environment.
Right.
What's the upside for you to, to do it?
I mean, they're just, they're gonna chase talent away.
Yeah.
Yeah.
I mean they, they're doing everything to push talent away.
Yeah.
Right.
Um, and so that is, yeah.
So they, they've already had the excise tax, but it was only for the top five highest earners.
Right.
And now they have removed that.
It's just everyone that makes over a million dollars.
Right.
So, so that's a sign significant de incentivizing tactic, um, to sort of, it feels to me like they just wanna push these nonprofits to become for-profit.
You know?
That, that, that's what, when I see something like this, I'm like, dude, I mean, they already have the worst, you know, a much harder payer mix than the for-profits.
Right.
So they, they're gonna be impacted in an outsized way, you know?
Yeah.
For everything.
We just spent the last 10 minutes talking about right now and, and now you're doing like little nitpicky things just to kind of like chip away at their viability.
I, it, it just feel, but, but only for the not-for-profits.
Right.
For profit, you could pay anybody anything you want.
Well, a for-profit would have to pay taxes too.
Yeah.
But, but, but they are used to that.
Yes.
And they don't have the same, I mean, you can get stock options, so you, you might be very happy with 800 k salary and then stock options, where if you're in a non-for-profit, that entire incentive comp package doesn't exist.
Doesn't exist.
Doesn't exist.
Yeah.
Yeah.
I mean, I, I, I agree.
That it's gonna be really painful for the nonprofits.
I don't agree they'll turn to for-profit because I don't think the markets are gonna support it.
No, I'm, I'm, I'm not saying that, I'm saying it feels like they're, you know, what Emily has been saying mm-hmm.
Sort of I, I'm, I'm reading into this and I'm saying Yeah.
It feels like they're trying to push them to do that.
Yeah.
You know, I, I'm not saying they're gonna do it, but it is gonna be very difficult for them.
Yes.
Really difficult for them.
Yeah.
I just don't think that some of the markets where non-profits are really serving an important role won't sustain a for-profit business.
Yeah.
Uh, you know, they're gonna put a tax on things like employee parking and transportation fringe benefits.
Right.
You know, it's just like, yeah.
It just seems, I mean, I get it and I also think it's like too overly like.
Picky.
I mean, like, let 'em have the, the parking benefit.
I mean, who cares?
Yeah.
Yeah.
Uh, and then, and then finally, um, and this is not for hospitals specifically, but this is a focus for academic medical centers.
Um, a new tax on, on endowments that starts in 2 20, 26.
Um, maxing out at 8% for adjusted endowments of, uh, 2 million or more per student.
So, um, you know, now, now the endowments are, are also, you know, under, under fire, right?
Yeah, yeah.
There's just, there's not, there's not much support today.
And this bill's taking, it's taking a lot of support away from health systems and from medi Medicaid enrollees, but more tax cuts for the VCs.
Yeah, yeah.
We, we get a tax cut and the estate tax, um.
Is gonna be maintained at 15 million exemption per person.
So it's good for the wealthy people, but it's good for VCs, you know, which we are VCs, so I guess it's fine, but not good for wealthy people.
I wanna live in a, I wanna live in a functional society.
Right, right.
I, you know what I mean?
Like, yes, I'm happy to pay taxes and, you know what I mean?
Yeah.
Like this, it's, it's breathtaking.
It, it's just, yeah, just amazing.
It's, it's amazing that this is the bill that passed.
Well, I mean, I think that, that, this is where it landed.
I think this is what Trump ran on and he's like twisted arms to deliver it.
It is gonna have long lasting repercussions.
I think I. I, I, I'm not sure he ran on cutting Medicaid and, and simultaneously increasing the, the deficit.
I, I'm not sure that was the platform.
Yeah.
But I don't think he could get, I don't think he could get his tax, you know, his tax, um, cuts from 2017 renewed and no tax on tips and all the other things he had promised without trying to negotiate with other people around various pet projects that they wanted.
So, alright.
More, more to discuss there.
But, um, you know, just, just a. Yeah, we're gonna talk about that until the midterms.
We may talk about that.
Yes.
Yes.
Agreed.
Uh, okay.
Uh, Andresen Horowitz, we're leaving Delaware and we think you should consider leaving too.
So we've put this in policy.
This is not in the VC section.
Um, we've been talking a lot about the buildup of the stock market and um, uh, the, the corporate business in Texas.
Mm-hmm.
Um, Elon's really sort of been driving that and Andreesen Horowitz, um, is sort of getting in on the whole bashing Delaware bit here.
Mm-hmm.
Talking about moving to Nevada.
Um, and they.
You know, what they say here is that they're moving the, you know, the state of incorporation of their primary business.
So they're not, they're not saying we're, we're changing every company in our portfolio to Yeah.
To be there.
Uh, but they are signaling that they probably will be making investments in sort of suggesting that companies, you know, shift their, uh, incorporation from Delaware to Nevada.
Yeah, that's right.
And I mean, I think there is, there are reasons to be frustrated with the Delaware court system and also it's bringing a lot of more complexity to, to this legal process that is maybe not the main thrust, especially in the early stages.
But, but yeah, they're, they're, they're leaving Delaware and going to Nevada.
Um.
And I think there'll be, there'll be lots of people that stay in Delaware, lots of people that go to Texas.
We, we have assets in Tennessee and Delaware.
It's gonna be like a free for all, all kinds of states.
Mm-hmm.
Things.
Mm-hmm.
Mm-hmm.
Uh, you know, they, they, they give this long thing about how Delaware, you know, used to be non-ideological and now has gotten in, basically has gotten involved in politics and is, you know, getting persnickety and things like that.
Um, fine, fine, fine.
Um, you know, they talk about shareholder limits on director and officer exposure.
Mm-hmm.
Statutory business judgment rule.
Um, I think that this, you know, inspection of corporate books and records, um.
Look Nevada's in the West, right?
I mean, it's just gonna be more laissez-faire than Yeah.
Than the East coast, uh, you know, approach will be.
Um, and, uh, I, I think, and you know, they're also talking about the established business courts and how Delaware has the court of chancery and used to be trustworthy.
But now, you know, Nevada is establishing a business court.
Texas has a business court, so there's other places that they don't have a monopoly on that business.
Um, I, I experienced this as increased legal fees for, for us and, and what we do.
Right.
What, what makes our industry highly, highly efficient is when we look at a deal, we're not doing the deal unless the company's a Delaware C Corp. Yeah.
Because we know what that is and we know what the rules are.
Right.
Don't have to think about it, everybody.
You don't have to think about it.
It's just like we all know what that is.
You know, if we have to start thinking about companies that we invest in being incorporated in two or three different jurisdictions, um, it's just gonna make the lawyers rich.
That's, that's my, I, you know, I, I don't think about that many things going into for us, early stage investors.
Yeah.
That many things going to, you know, corporate court and I just don't Yeah.
That's not something I'm worried about.
I mean, in 25 years I've never had a case go to, go to trial that Right.
But you play plenty of lawyers Yeah.
Yeah.
To read through contracts and make sure we're, we're together.
So I, I, I just see this as like increased legal fees and not very fun.
Yes.
Yeah.
Not exciting.
So, fine.
Thanks Andres and Horowitz.
Uh, okay.
Moving into the payer world, more pressure mounts on health insurers, this cost continue to rise.
We just talked about, you know, what the impact is gonna be to all the different payers we listed Molina, um, there as they have a pretty heavy government pay business and Molina has warned Wall Street that they will not meet expectations and, uh, they're not the first to say that.
Right?
Yeah.
That, that's right.
It's gonna be.
There's gonna be several quarters with payers and health systems.
Uh, warning or missing earnings, or there's not, I mean, blue Cross is out there.
There aren't as many nonprofit just by numbers, right.
Payers.
Um, so the health systems has that whole nonprofit, uh, thing that aren't in the, aren't in the public stock market.
That will be slower sort of getting numbers out, but, but yeah.
Molina's suffering.
Uh, HCSC launches the rebrand of its Medicare unit as HealthSpring, which is what it already was.
What's old is new again.
That's right.
Uh, yeah, so I mean H-H-H-C-S-C they bought, um, the Medicare business from Cigna and Cigna's Medicare business was called HealthSpring.
Yeah.
They bought Nashville based HealthSpring.
Yes.
Jamaica.
Right.
Um.
I like the brand Health Spring.
Yeah.
It's a natural brand.
It's, yeah, exactly.
But I, I don't know that, um, I don't know.
I guess it's fine.
I mean, it's a well-known brand and Mary Kay Advantage.
Yeah.
It's just a silly headline.
I'm glad you included it.
'cause it just shows how, you know they did, they added a little swoopy, uh, icon.
Yeah.
Well, and what did they say represents the vi, the vibrancy and vitality of the brand.
Yeah.
Yeah.
Some consultant got paid a lot to do that.
When are we gonna get that gig?
Yeah.
To change the color of a logo slightly, right?
Right.
You paid like $2 million to do it.
Uh, CVS Omnicare ordered to pay 949 million in government fraud case, almost a billion dollars.
Um, so Omnicare is cv S'S pharmacy business that is non-retail.
So the one that works with, you know, um, different providers around the country.
And, you know, uh, Manhattan Judge Colleen Mc, uh, McMahon imposed $542 million penalty for what she called very big fraud in her Monday order and awarded 406.8 million in damages three times the 135.6 million that a jury awarded in the spring as required under the False Claims Act.
So, I mean, CBS Omnicare filed more than 3.3 million false claims between 2010 and 2018, according to court documents.
3.3 million false claims.
Yeah, I mean, that's crazy.
This is a crazy story.
I means crazy.
So Omnicare.
Has been found guilty of sending prescription medications to assisted living facilities or nursing homes, other institutions.
This is not a retail platform, right?
When they didn't have prescriptions for them, they just were sending them over and charging.
It's hard to believe that three over 3 million false claims over eight years happened.
Uh, but that, but that is what the court found.
And so yeah.
Almost a billion dollars in fee.
It's a huge penalty and a, and a very big fraud.
So huge, huge, uh, I mean, billion dollars.
Yeah.
Um, so yeah, that's, CVS is in trouble.
And this is not even their upcoding.
No, it's not the up, it's not the upcoding case.
When I saw the headline, I was like, is this the Upcoding case?
And it's like, no.
It's like, oh my God.
They've Right, they've got a lot of, lot of fraud Yeah.
That they're dealing with.
I didn't put it in, but um.
UnitedHealth group is being investigated all over the place.
It just, there was no point to the story.
Just like, yeah, they're being investigated.
So, um, I. Yeah, there's a lot of investigations into the payers Oof.
Samsung to acquire digital health firm zf.
I think that's how you pronounce it.
Yeah, I think that's right.
Um, so, you know, Samsung's been teasing about getting involved in health mm-hmm.
For a very, very, very long time.
Um, but this is a pretty meaningful acquisition.
So for anyone who doesn't know zf, which is spelled X-E-A-L-T-H, so health except for replace the H with an X, um, it's like the digital health app store mm-hmm.
Inside of the EMR at hospitals.
Right.
So, you know, a, a clinician from inside of their epic instance can open up and they can access Yeah.
They know it's gonna work.
They know it's gonna work.
It's all certified.
Right.
It's all approved.
And they can access Weight Watchers or maybe there's like a Fitbit integration or something like that.
Yeah.
So they, they can pull in all these digital health, you know, but like, not, not little guide digital health things.
They're like real big digital health things.
Um, and they can integrate them into their.
You know, their, their prescriptions, the protocols that they're, you know, put Yeah.
They can tell a patient, patient's on, I'd like you to exercise more, right.
Here are the four apps that we offer.
That's right.
Uh, and the patient, and it will tie back to the emr.
Right, right.
So, so yeah, I think it's a good, it's, I would love for Samsung to get in, like seriously into healthcare.
They've been, as you said, they've been sort of talking about it, so it's great to see them make this acquisition and hopefully they'll, they'll grow.
Yeah.
I mean, they've got their, their Galaxy watches.
You know, apple, um, has had a partnership with Epic and has used that to proliferate through many, many hospitals.
Yeah.
I first learned about that I think in 2000.
17, when, when, uh, our friend Steve Mtier, you know, brought me up to Geisinger.
Mm-hmm.
And I was like, oh wow.
Here's Apple and Yeah.
You know, epic working at Geisinger, you know, and just like everyone's got iPhones everywhere.
Um, so this, this, you know, to me, especially when we have RFK Junior talking about how he wants everyone to have a wearable on Yeah.
Seems pretty smart for Samsung to, to start to get meaningfully integrated into the health systems.
Yeah, I agree.
Uh, okay.
SIMR acquires a MN healthcare's staff scheduling software for 75 million.
So, you know, we like simr, they've bought stuff from us before, so, uh, and this is a, you know, we, we like m and a deals.
Yeah.
And scheduling is a big problem.
I mean, we've tried, we've made a couple investments trying to solve it.
Health systems are still doing scheduling on paper or in complicated Excel sheets.
And so, um, I think Simpl will be able to take AMNs scheduling software and.
Yeah.
It's hard when you're the vendor bringing kind of travel nurses in to, to be trusted to schedule the whole thing.
Right.
I think Simpler is a, a better place to bring that from.
Yeah.
And it looks like there's also some additional strategic synergies that SIM and a MN are, are putting together here.
Yeah, yeah.
Between the operational technology and the workforce solutions, uh, on both sides.
So, um, you know, it looks like, looks like a good partnership there.
Uh, okay.
Going into Pharma, Merck is buying Verona Pharma, uh, in a $10 billion deal.
So Verona Pharma is a publicly traded company on the London, uh, stock exchange and $10 million seems like a pretty good deal.
Yeah.
Yeah.
It's, it's a, it's A-C-O-P-D treatment.
Um, yeah.
So it's a, it's a 20% premium on what it's been trading a little over.
It's great for the, for the shareholders.
Yeah.
And it gets Merck into the COPD space.
Um.
It seems good all around.
Yeah.
Yeah.
So we're, we're, we're used to talking about $1 billion transactions.
That's, that's a big, that's a big deal.
Uh, okay.
So health and us, this, this story is terrifying.
Yeah.
This is a rough story.
Wall Street Journal, here's the headline.
She paid $1 million to join a senior facility.
It's bankruptcy wiped her out.
I mean, this is the kind of thing you don't really think about, but Yeah.
But you really should.
And so this story is, is covering this woman, her name is Arlene Cohen.
And, uh, she was, um, she was a, a widow and she moved into Harborside, which is a continuing care retirement community.
So kind of has the whole step up or step down, depending on how you like to see it.
Yeah.
Right.
Uh, but that whole continuum of care, like, starts with, you know, uh, independent living.
It moves assisted living, it moves into, you know, yeah.
And there's a buy-in.
There's always a buy-in in those.
So the buy-in was $945,000.
Okay.
Then on top of that, you pay $5,700 in monthly fees.
Um, and then what they said was that 70, 75% of that upfront fee would be refundable to her family upon her death.
Okay.
That's what they told her except they went bankrupt.
Right.
And now their family thinks they're gonna get like a less than a third of the$710,000 refund that was promised to them.
And now she's in a new, she's gotta be in a new facility.
Right.
She, she sold, she doesn't have money to do the buy-in for the next facility.
She needs a buy-in for the next facility.
So she's just in like a, you know, just a new facility.
Right.
She, she's a sunrise senior living now, you know?
Um, but, uh, you know, she sold her house to buy in to this Harborside place and they, they robbed her.
Yeah, they robbed her.
They, I mean, I think more incompetence, but yes, the result's the same.
They, they, they wasted and lost the money.
Yeah.
Yeah.
And she's the one that interviewed with the Wall Street Journal.
I think there's probably a lot of seniors at that facility that when they went bankrupt, you lost your buy-in.
Everyone lost their, and that just tells you like how unregulated these places are because anytime you take a, you take an entrance fee like that, and then you say, we will repay 75% of that fee.
That's kind of like a bank.
You ought to be regulated, like someone be, ought to be able to check that you've got that money sitting in escrow somewhere where you can't get to it and it should be like earning interest or whatever.
Yeah.
It should be like an insurance regulation.
Yeah.
You have to reserve capital to actually deliver on the care you have promised.
That is shocking that, that this can even happen.
Yeah.
There's, they're not regular like that, these dollar amounts.
Yeah.
Yeah.
For people who cannot be economically productive ever again.
Yeah, it's shocking, Vic.
It's shocking and it's sad and, and it's, I don't know that we have regulators that can take it on, but, but you're right.
It's, there's no way for the individual family to, to decide, okay, this place is well run, this other place is not, um, yeah, it's a sad story, but it's a kind of a warning.
You need to scary, you need to somehow try to, try to look into their policies or something.
I don't know.
I like, if I was gonna do it right now with one of my parents, I don't know how I would assess it.
I mean, so, so here here's the really tricky thing, right?
The tricky thing is that how this generally works is most of these people that have Medicare.
And they have some savings, but the real long-term care money is in their house.
It's in their home equity.
And so that means in order to unlock it, you have to leave it.
You have to leave it, and you have to sell the house.
Right.
You, yeah.
So, so, so the whole idea of we'll just do the care at home, you kind of, you really can't do that.
Yeah.
Because you can, you need the money out of the house.
You need the money out of the house.
You have to sell the house to unlock the cash to then do whatever the thing is that you're gonna do.
Yeah.
So then it's like, okay, well then where, you know, maybe you look for a much smaller place where, okay, you take those proceeds, you buy something much, much smaller, and then you take the remaining cash and you try Oh, if you're gonna do it yourself, you're saying Yeah.
If you're gonna do it yourself.
Yeah.
Sorry, I wasn't that clear.
Yeah, yeah.
If you're gonna do it yourself.
Um, but the, the truth is there's just not that many, there's not that many options on how to do this.
Yeah.
And it's, and it's hard to know.
How long the senior will be independent.
I mean, we're all aging.
Almost impossible.
There will be a time when they can't live alone anymore.
Yes.
And so I think that's why these continuant, um, whatever they're call continuation facilities.
Make sense?
'cause you, you move into the independent living and you might be there for six months or six years or 12 years, but whenever you have to move to assisted living and then memory care, it's there for you.
Right.
The problem is there's a lot of planning involved in that and it's really difficult for these facilities to know who's gonna move when, how do I organize this?
And I think the truth is they just don't plan in very well.
Right.
They just.
Close their eyes and hope, uh, terrible, terrible, scary, scary story.
Yeah.
And, and, and definitely, I mean, I, I'm kind of living this right now, and so like, it, it gives me something to think about and to look out for.
Yeah.
And I don't know how you look out for yourself.
I mean, like, I don't know what I would try to due due diligence on, right?
Like, uh, right.
Yeah.
Robinhood.
Oh, so we're in a Web3 section?
Yeah.
Web3 section.
Web3 section.
Okay, good.
Uh, Robinhood wants to redo Wall Street on the blockchain.
So Robinhood made a huge splash last week, um, by o by offering tokenized stocks.
Um, you know, Robinhood just actually just really crushing it.
Um mm-hmm.
You know, they had that black eye went moment when like, uh, you know, they, they, they had to shut down the app because yeah.
All the crazy trading that was happening and, you know, um, but they, they really.
I didn't realize that they had, um, positioned so aggressively around crypto, but if you, they bought Bitstamp.
Yeah.
But, but here's what I mean when I say positioning.
Like if you go to the app store and you go to download Robinhood, the, how they list Robinhood in the app store is Robinhood buy B-T-C-E-T-H Soul.
So it it they, they're actually positioned as like a crypto app.
Yeah.
That's interesting.
Which is crazy 'cause they, they've, they came out of the gate as a stock.
Yeah, right.
It's a stocks app.
Right.
Um, and how they really differentiate against Coinbase is their a hundred percent retail focused.
Right.
Whereas Coinbase is, has a big, big institutional business now.
Yeah.
You know, they've got the base network, all these other kind of things.
Yeah.
Robin Hood's very, very focused on, on retail, retail, retail, retail.
Right.
Um, and so they are now.
Tokenizing not the actual stock.
'cause they can't actually tokenize, you know, these, these private company stocks.
Um, but they are tokenizing.
What, what would you, what would you, well, let, let's, let's start with the easier thing to start publicly traded stocks.
Yes, yes, yes.
Sorry, I, I, I'm focused on open ai, the place to start where they started in, they're in Europe.
Yes.
Live.
Where you can buy, I don't know, Google any, any publicly traded stock, um, through their app.
And they are tracking it with a, with a token.
And then they, they will buy when the, so they do it 24 7 on the weekends, whatever you can buy.
And then they will buy a share of Google and kind of match it.
Um, so that, that's where they started.
And then they have built their own ETFs where they group together, like all the mag seven or whatever they decide they want to do and, and offer lots of optionality.
Um, and you can buy, you don't have to buy a full share.
Right?
You can put $5 in, you can do all across averaging.
Yes.
$5 a day.
Yes.
Yes.
All that stuff that they created.
Um, they're doing, and then they, they did open AI and starlink, SpaceX, SpaceX, SpaceX, uh, which are private companies, which are private.
Those are the two they are offering in Europe still.
Yes.
And they have formed a partnership.
They didn't announce who it was with someone, a VC firm or a family office.
Thats who holds those, who holds some of those shares.
Yes.
So that they have the rights to buy them.
Right.
I think that's how it works.
Yeah.
Um, they only are offering those two right now, but they are promising to offer a large number of privately traded assets.
And then they are coming the US I mean, I mean, which is crazy 'cause that front runs on IPO.
Yeah.
And, and like any potential future IPO you, you know, you, you're letting the retail market get in to the private markets through this token loophole.
I mean, it's Which they should be in.
No, of, of course.
I, I'm so excited about this.
I think this is great.
But, but it's a big deal.
Yes.
It's, I mean, changing the accreditation rules ridiculous.
Yes.
Is, is the effectiveness of it.
Right.
So they've done it in Europe, it's, it's live.
Right.
And they are now pushing.
For regulations to bring it to the us.
Right.
But it's not live here yet?
No, no.
Uh, we have the next articles about, or a couple articles we, the SEC is, I think, open to it, but we'll get to that when we get to it.
Yeah.
So I think it's really exciting, uh, that they're by, by the way, I think we need to say Robinhood, I think was one of three, uh, exchange based businesses last week that had some type of tokenization announcement.
So clearly there's a wave of tokenization that is, that is on the horizon.
And the fact that you can do all this in Europe today, you know, it's like people talk about all the crazy regulation of Europe, et cetera, et cetera.
Mm-hmm.
But it's like not on crypto.
Right.
They're way ahead of us on crypto.
Yes.
Way ahead of us on crypto.
So just, just worth, worth pointing out.
Yeah.
Worth pointing out.
Um.
This is, uh, an next post, uh, where Vlad was talking.
And so, yes, SEC chairman Paul Atkins.
We've got a link in the, in the show notes to an interview with him on CNBC.
But basically he is signaling, uh, very early in his, in his, uh, chairmanship, he's signaling that he is open to exploring and running pilots mm-hmm.
With the tokenization of private companies.
Yeah.
He basically was saying the SEC should be innovative, we should have the most innovative financial markets, and he wants to move into it slowly, but he, his, he thinks his job is to turn the SEC into like an enabling engine.
Yeah.
Yeah.
So it was all really positive, um, to innovation.
Yeah.
I, I, I continue to, to see things like this and, and just be so mad at Elizabeth Warren, uh, you know what I mean?
Like Yeah.
Um, I just.
I mean, it was, it's self-inflicted for no benefit.
It's ridiculous.
Yeah.
It's ridiculous.
It's ridiculous.
It was so stupid.
It was so stupid.
Because it was also inevitable.
It was inevitable.
Like it's happening in all manner of continents all over the world.
Yeah.
Right.
Like, what were you doing?
What do you think you're doing?
Okay.
I I, I talk about this every time we bring this up.
It just makes me, it just makes me mad.
Yes.
Because it, it did not serve the Democrats in any way.
No.
They just seemed outta touch.
Yes.
And she's still running her mouth about this shit.
You know this.
Yeah.
She's still talking about it.
It's like, could you, could you please just shut up?
Or somebody primary her or something?
I don't know, man.
I mean, but like, yeah.
She doesn't understand it.
No, she's not helpful.
She's not helpful.
Okay.
United States, uh, uh, house committee on ways and means, so the Genius Act, which we talked about, I guess in the last show, which would've been two weeks ago, uh.
Passed the Senate, um mm-hmm.
You know, sponsored by Bill Haggerty.
Uh, it's now in the house.
Apparently there's another bill in the house called the Stable Act.
And so I think they're kind of figuring out which of these is gonna make it through.
I think the Genius Act is the one the whole industry is behind at this point.
So I think that's the one that's gonna get pushed through.
Um, but in the house they are exploring, I think, a broader set of questions.
Mm-hmm.
Some that are about the market structure, and that's kind of, you know, yeah.
This whole tokenization of private assets, um, or, or public assets.
Right.
Just the idea that we can Yeah.
You know, basically create a token.
If we can make a token against the dollar, why can't we make a token against, you know, securities?
I mean, I'll go even further.
You can make a meme coin on nothing.
Yeah, yeah, yeah.
Far coin farco.
Right.
And I can invest money and invest in quotes, money in that today.
Yeah.
Today.
Yeah.
And so why can't I buy Google?
It's so stupid.
Yeah.
It's, it's really stupid.
Yes, that's right.
Um, but they are looking at broader things like market structure, but also.
Tax policy.
Mm-hmm.
So, so there's a lot of people pushing for crypto to, um, be a, a non-capital gains, uh, taxable transaction platform.
That's, there's a lot of people pushing for that.
I don't think that makes sense, but yes, there are people pushing it.
So, so I mean, people will talk about the, when you, when you're talking about actual currencies, so like Bitcoin and EI can, I can see, right, Solana maybe I can see, right.
But the tokenization.
But when you go to, you know, me tokenizing a company that I invested in a little startup that should be capital gains.
Like when I sell it and I make a bunch of money, I think you should pay capital gains from that.
I mean, I don't think it makes, makes sense.
I mean, look, the.
But yes, there's a lot of, but this, this group, it's a lot of hope group.
There's a lot of rumors, this group that there's no taxes anywhere.
Right, right, right.
No taxes anywhere and, and let the poor eat themselves.
I mean, you know, who cares?
We'll be fine on our jets.
Yeah.
Right.
Okay.
Uh, moving into ai, so starting with this Reddit, uh, post, this is in the subreddit chat, GPT, and, um, a doctor, uh, did a really thoughtful post around his assessment of, um, chat GPT and, and, and what it really means to use it in a clinical setting.
Right.
So, uh, the, the title of the post is as an md. Here's my a hundred percent honest Opinion and observations advices about using Chat GPT.
Um, and basically, you know, he says it's incredible, but also.
As, as we've been saying from the beginning about all this LLM stuff.
It depends on what you feed it and how you prompt it.
Yeah, right.
Depends on what you feed it and how you prompt it.
So yeah, it's worth reading.
We'll put a link in the show.
Yeah.
It's worth reading it 'cause he does a really good job laying it out in a organized fashion.
But we, we can summarize it here.
Yeah.
And, and, and I, I think his, his general, uh, you know, recommendation is you should use chat GPT to second guess your doctor.
Mm-hmm.
Yes.
You should use chat GPT to prepare for your clinic visits.
Yes.
But you should not use chat GPT to validate your fears.
And this is kind of the big thing that I think people are starting to realize is that, um, these LLMs they don't tell the truth.
And, and I, I don't mean that to say they lie, but it, I I mean, not to say that, that, uh, they absolutely will feed your, um, cognitive bias.
Yeah.
They, they are, they will, they're tuned.
To satisfy you or, or make you happy with the response?
Yes.
So they try to give, they literally are optimized to give you an answer that will, will please you or will make you happy.
And so yeah, if you are, um, if you have fears, I mean, the example he gives, if, you know, if you ask enough different ways, if you have cancer, what if would this mean I have cancer that by the time you ask the fourth time, right.
Just like a friend of yours might realize, okay Marcus, just keep asking me this until I, until I agree it, it just says, it just starts agreeing with you.
Right.
And then, then it will find or make up examples.
And the problem is it's, it's really very good at then building a. Super compelling case with all kinds of studies, some of which didn't happen, other, which that did happen, but it's framed a little differently and you get lost in this rabbit hole.
Right, exactly.
So anyway, link in the show notes.
Uh, but thoughtful.
Right, and, and yeah.
And always looking for more clinicians to weigh in on this topic because it's, it's the future.
Yeah.
It's this integration of, you know, clinicians and LLMs is, it is, it is Absolutely.
The future.
Uh, okay.
Boy, this has been a wild ride this week.
So Elon Musk has released, and Elon Musk's Xai, um, has released Grok four.
Um, this is the latest model from, uh, from Xai.
Mm-hmm.
And it is, you know, it's a benchmark beater.
It's beating.
Yeah.
Uh, many of the other frontier models on a lot of different fronts.
Um, the thing that Elon was most talking about was how, you know, his team is using rock to code and it's much better than Claude.
You know, Claude has sort of been the defacto best coding, uh, model out there for quite some time now.
Um, and so he's pushing that, you know, the.
They, they've unveiled a $300 per month AI subscription plan for the called Super Grok Heavy 'cause there's a Grok four heavy that's like sort of the, you know, the, the really compute and power intensive version of, of, uh, of the model.
But the problem is this news is happening at the same time as, you know, Lindy Heino is, is, uh, you know, resigning right as the, as the CEO of X. Uh, which happened to also coincide with many people finding rock to, you know, basically speak like a Nazi.
Um, and also, you know, speak with a whole bunch of pornographic references specifically to the CEO right, of X Lin Aino.
So, um, I mean this is kind of the, the problem with Elon is like, he's brilliant, he's very effective, and he's simply.
Not a serious person, which is the, which is the weirdest combination of things to say about somebody.
Right.
Um, but it's just not serious.
It's like, you know, it's like everything's a joke to this guy and so his model ends up doing stuff like Yeah.
Talking like a Nazi.
Right.
It's just, yeah.
So I agree.
The, there is, I think, a useful reason to talk about this, which is the, um, Elon built the biggest compute so far in Memphis, and the scaling laws are still holding, right?
Like more compute, more data gives you a smarter model.
Model.
Yes.
Period.
And I think what that means is that whether GR is, you know, ends up being a model that a lot of people use or not, I don't know.
I think probably not, but I think it means that there's gonna be more.
More compute thrown at models.
Absolutely.
Because the scaling laws are still holding.
Yeah.
So Gemini, open ai, andro, grok, whatever ones I've forgotten, are gonna keep throwing more and more compute because it keeps getting smarter.
I think you're exactly right that, um, these models need to be, um, controlled and tuned and moderated so they can interact with humans in a productive, healthy way.
That is empowering.
And I'm not sure that that grok is tuned that way because I haven't even used it, but there's so much noise around it.
I think it's, it seems like it's very performative.
It beats all the benchmarks, but it also goes off the rails and does all kinds of other stuff.
Yes.
And to me that means it's not.
The, the post training and all the fine tuning well wasn't done in the way that we're all used to.
Yeah.
Well it it's almost certainly tuned to be anti woke.
Yeah.
Right, right, right.
So, so, so, so, and maybe a side of the fact of that is that it, it, it talks about not Nazis and things, I mean Well, yeah, because, because, you know, it's, it's not trying to cloak what it means to be anti woke.
Yeah.
It's, it's not socially aware enough to, to try to hide it, realize that I have to, I don't know.
Yeah.
Hide it to, yeah.
To, yeah, exactly.
Yeah, exactly.
Yes.
Yeah, yeah, yeah.
Uh, so I don't think that one, I think gr is late to the party and people already have models they like, yeah.
And, and the brand of grok is not good.
And the brand is not good.
I. But the scaling laws are still working and, and we're gonna get smarter, smarter models.
So, uh, we do not have a story about this, I don't think in our lineup, but your point about the scaling laws and the investments is a hundred percent true across the board.
All the max seven have doubled down on their investments all around power and data centers.
Right.
And, uh, I I was just reading that story earlier today, so Yeah, for sure.
The arms race continues and intensifies.
Yeah.
Because we're just seeing that, you know, the combination of unlimited power, unlimited compute in the form of a data center and the best brains, human brains you can put on this Yeah.
Is continuing to net better and better and better and better results.
That's right.
That's right.
So open AI's, uh, five I think will come out this summer or fall.
Google's Gemini three will be out this fall.
So, and Thropic I'm sure has another, they'll, they'll keep coming out and we're not.
We're not gonna get, we're not gonna go backwards.
No.
So I think other models will be, um, socialized maybe better and fit into society better.
Yes.
Yes.
Uh, but rock is pretty smart.
Yes.
Um, Microsoft is touting $500 million in AI savings while she slashing jobs.
And so, you know how they're gonna justify making all these massive investments.
They're gonna keep showing that they can save money.
Yeah.
Um, by not paying people.
Right.
So we're gonna have more, you know, you know, you know what's really scary about that is that the, those, those medic, those Medicaid enrollment numbers could grow over time.
Uh, if we actually end up in the landscape that, you know, some people predict that we will be in mm-hmm.
Where many people, you know, specifically knowledge workers lose their jobs and simply can't replace them.
Yeah.
Well, we don't need as many knowledge workers.
No.
I'm, I'm hopeful we will find more knowledge workers are not very resilient people.
Yeah.
That, that's, I have fear about that.
Yes.
They're not resilient people.
Right.
They think they are.
Right, right.
But they're not.
Right.
They're not.
So talking about the, the, the arms race on the hiring side, meta hires top Apple AI expert, continuing Zuckerberg's recruitment push.
This is one of two stories we're gonna cover here.
Um, but this one I think is, is pretty meaningful because taking Apple's top hire Yeah.
Uh, of, of ai, that, that just shows, it probably shows a couple things.
One, Apple's in trouble.
I mean, I was gonna say first Apple's in trouble.
Um, and second, you know, meta is not playing around.
Playing around.
Yeah.
They're offering this guy like $10 million a year.
Right.
So that's, that's crazy, right?
Yeah.
Yeah.
So they took meta, took the top AI researcher, and then the COO resigned yesterday from Apple.
Yeah.
Yeah.
So design is now reporting into Tim Cook.
Yeah.
Yeah.
I don't know that, that's great.
The last design was not that great.
So yeah, apple is struggling and then I think Meta to Zuckerberg's credit, they're behind in ai.
They tried the open source tactic, which had worked in other technical areas for meta, but, but just didn't, didn't work or they didn't pull it off or they didn't put enough behind it.
Llama's not really in the conversation that much anymore.
Yeah.
So is how duty does Best Buy.
Right?
Yeah.
And, and to his credit, he's, he put a lot of time and money behind it.
Personal time.
He, he like personally recruiting these people with tons of money.
He, he might be the best acquirer mm-hmm.
Of, of, of this error.
He might be the best acquirer.
I mean, because like Meta is where it is today because of Instagram.
Yeah, yeah.
And when he bought Instagram, like everyone thought that was the stupidest billion dollar acquisition ever.
Yeah.
But it was brilliant.
And look at it now, it's brilliant.
Yeah.
Look at it now, right?
Yeah.
Yeah.
So this one came out after this story, Zuck 11.
So it's 12 now.
But it just lists off the, he hired seven senior people from OpenAI, right?
Two from Google, one from Anthropic, one from Sesame, um, OpenAI.
The other thing that's interesting is OpenAI has lost a lot of talent just to, just to meta.
Um, they have a lot of talent, but, um, they're not as deep as Google and they lost a lot of people.
Yep.
And they're pretty senior folks.
Yeah.
So seven from OpenAI, two from Google, and one from Anthropic, one from Sesame and one from Apple.
Yeah.
12. That's right now, uh, okay.
Nvidia is now the world's first $4 trillion company.
Yeah.
Incredible.
I, I, I think it's, it's great to see an American company like that's been around for long time.
40, 40 years.
Yeah.
Um, keep ing around and then I.
They're, they've taken off, but they're, they're working hard and they, they have a great product.
So Yes.
Yes.
I think it's good.
I, it's, it's mind blowing, like to think about how long Nvidia has been around.
Yeah.
You know, um, they were just the gaming chip company, you know?
Right, right.
And then all of a sudden that capability was really valuable in other ways.
Yes.
Right.
Yeah.
Right.
Alright, so we got three stories here that, that all sort of Yeah.
Make up one thing, which is sort of the shift out of search and into, um, AI chatbots, um, as, as the primary discovery interface for the internet.
Yeah.
Like what is the front door to the internet, what is the front door to the internet and um, you know, the search engine, which is just a simple one Text field Yeah.
Form.
Is being replaced by the chat bot, which is also a one text field form.
Right.
So it, it was the perfect swap out.
Very, very low switching costs.
Yeah.
Right.
Um, higher quality results on the other side.
More personalized.
Mm-hmm.
Um, and much more interactive.
Right.
You know, you can go deeper and deeper and deeper with it.
Yeah.
And less work for the user.
Like, just gimme what I want.
Yes.
But don't make me go search for all these links.
Right, right.
And put a bunch of advertisements and other crap and blah, blah, blah, blah, blah.
Right.
So, um, there's now a bunch of, you know, I, I, I told you it's like there's SEO and then there's Aio o Yeah.
Right, right.
Um, and SEO is dying.
It is and a IO is on the rise.
Yeah.
Um, you know, I'm on the, I'm on the board of, well shoot chair now the chair of the Nashville Convention Visitors Corporation, and we just launched a brand new website for Visit Mu, visit Music City.
Mm-hmm.
And, uh, one of the big features of it is that it is, um, a I owed, meaning it's optimized so that when you search on chat GPT or Gemini about, Hey, help me book a trip to Nashville, um, this website will be feeding the response that you get from those LLMs.
Right, because it's been optimized for that the same way.
Yeah.
Websites were previously optimized to get, you know, in that first page with its blue links.
Right.
Um, and it's, and so it's a whole new discipline in marketing and therefore there's a whole new set of companies out there and technologies that are helping everyday marketers to make sure that they show up because it, the stakes are even higher now.
Right.
It's, it's, um, you know, before it was like, I wanna show up on the first page, now it's, I want to be placed in the first paragraph of the response.
Yeah.
Right, right.
Yeah.
And for the visitors bureau or whatever the, the group is, um, they really just want people coming to Nashville and enjoying everything we have to offer.
I think.
Yes.
The, if you are selling a, a widget or something, the, the monetization avenue, I. Of internet, of the Internet is a lit, is a little more complex.
So like feeding information is possible with optimizing ai, but getting to them to transact and pay you money.
So say you're writing a review about, I don't know, new phones, you, you need to get paid for that somehow.
And if you optimize to get your information into the AI without a monetization plan, that's not gonna work.
No.
So it's, it's just gonna be much more nuanced and, and it complex, I think.
Yeah.
At some point it'll become standard, but right now we're all figuring out as we go.
Yeah.
It's all being made up.
We, we go.
Yeah.
Right, right.
Um, so, so we've got this link to this Wall Street journal journal story.
Uh, the headlines, the company's betting they can profit from Google searches demise, and it just sort of tells you about, talking about optimizing all the companies that are coming out for a IO.
Yeah.
Um, so.
Sort of at the same time, CloudFlare, um, you know, which is the big DNS caching company that basically is, uh, the, the true front door for the internet that nobody sees.
But if you, if you host a, a big website, yeah.
It's a pretty good chance that CloudFlare is like serving up and also protecting you from DDoS attacks and things like that.
Yeah.
If you want your video to play really fast, quickly Yes.
In, in Europe, in Australia, that's right.
In the US you're using CloudFlare.
Yeah.
They're caching.
They, they're caching that content all around the world.
Yeah.
And then they deal with security for you.
Yes.
Yes.
Um, and so.
Who, who better to see the impacts of traffic from AI crawlers now that they are everywhere mm-hmm.
Than CloudFlare.
Right?
Yeah.
They're gonna be seeing that and they, and you know, they recognize that it's their responsibility just as it has been to protect you from the Russian and South Korean hackers who want DDoS your site and, and take it down.
Yeah.
Um, they protect you from that.
They also wanna protect you from these AI bots that, you know, have no business crawling your site and taking all your content.
And, you know, now you can't monetize your content yourself.
Right.
Because the AI has taken it over.
Right?
Yeah.
It's a threat to their clients, the threat to the cloud for business.
Yes.
Yes.
And so they say that they're going to come out and create this, you know, easy button that's going to protect you from the AI bots with one click.
Um, yeah.
What, what they are saying is they will allow content producers to charge.
So they have a tool that would block the crawlers.
Then you can charge for each time it, it visits your, your content and Right.
And grabs it.
Um, which would be, which would be great and would probably, um, bring some reasonable economic model.
We need people to create content about.
Sure.
Everything.
Sure.
Um, so that's what they're trying to do.
Uh, but the problem is it's, it's not that easy to do, not that easy to do.
And so they're having trouble doing that, but not also shutting down Google search crawlers.
Mm-hmm.
And so you block the ai, but it's also impacting how you show up in SEO and people don't want that.
Yeah.
I think this is an interim, this is all interim stuff.
It soon, a year from now, I think a lot of content producers will say, I don't care if Google's crawlers.
Come, I, I, I care more about being able to stop the AI crawlers.
Yeah.
Well, well they'll, they'll say, I don't care about Google search, but I do care about Gemini.
Yeah.
Alright.
Right.
Well, but they, they're gonna want to charge Gemini whatever it is, some amount in order to Yeah.
Get their stuff.
So, so the problem is Google does not have a separate set of crawlers for Gemini versus Google search.
Right.
It's the same crawler.
Right.
Right.
So if it's the same crawler, it's kind of hard to stop it for one intent and not for another.
Yeah.
I, what I'm saying is I think they're gonna eventually, I. Just say, Google search is over and we're stopping Gemini and Google search.
Yeah.
But they, they, they gotta the revenue now.
They're not, they gotta fix the revenue first, right?
Yes.
Right.
So, so thi this is an entire, I mean, you know, many of the listeners, you may not even know that a IO is even a thing, you know?
Right.
Um, but we just figured this was a, this was a fun way to end the show because it's, it's practical.
Um, and it's a way that AI is changing the internet, and it is, this is going to actually in, you know, impact all of us.
Yeah.
Right.
You know, we Jumpstart has a website.
Yeah.
You know, we're, we're used to doing the, the SEO thing.
Yeah.
We're not used to doing the a IO thing, and we're gonna have to do that now, thankfully, you know, we work with, you know, WordPress and, and HubSpot.
Yeah.
Those tools w will, they'll take care of this for us.
Yeah.
You know what I mean?
They'll make sure that everything we have is properly AI owed.
Yeah.
And, and I think for health systems.
Maybe for payers.
I gotta think about that.
But getting your health site, it's, they should be, I mean they're like the visitors bureau.
That's right.
They should be educating people about getting their knee and hip done and all, all the different procedures using a IO because then you're gonna have to show up at the facility and you want to be educating folks about come to our facility, we have the best, best recovery rates.
The best care, the best, best doctors.
Yeah.
Whatever you have on your website today, you should customize to a IO.
You know what's really interesting about saying that, um, there's probably a window similar to like the dawn of social media where there's big arbitrage upside.
Mm-hmm.
Yes.
To leaning in very heavily on this.
Yes.
And this is probably a very big deal for startups.
Yeah.
Right.
Where if, you know, your audience is heavily indexing to, you know, chatbots over, um, over search engines.
Yeah.
There's a window, I don't know if it's 12 months, 24 months, 36 months, but there's a window where you really can probably get huge marketing, ROI mm-hmm.
On deeply investing in a OI, yes.
Uh, a IO, sorry, A IO and then also the influencers in social media plus AI assets.
Yes.
Yes.
That's a whole nother topic, but um, you can really leverage thousands of influencers and give them assets that you really couldn't do previously.
Yeah.
Um, and startups or really anyone can do it, but startups are the ones that are, can nimble enough and fast enough to be able to do it.
Right.
Right.
Uh, okay.
Good show.
Yeah, that's good.
And, uh, next week I'm sure we'll have more analysis to pour through on the impacts of the bill.
Mm-hmm.
Um, and, uh, more in the Elon and Trump saga.
Uh, and, and, uh, you know, and also, I mean, we didn't say at the beginning, but you know, here in Nashville we've, we've lived through a terrible flood and it was, uh, kind of like trauma inducing to see what has happened in Texas.
Um, because I remember when the Cumberland River, you know Yeah.
Sort of rose and, and it didn't raise anything nearly that fast.
Right.
So it's just Right.
And my kids went to camp.
Wendy knows people that had girls at that camp.
Yeah.
This, this year, it's, it's really sad to see young children.
I mean, anyone getting into that, the children is hard.
It's terrifying how fast the water rose.
90 minutes.
Yeah.
In the middle of the night.
Ugh.
Terrible.
It's just, yeah.
Really, really scary stuff.
So anyway, um, you know, I just, I. I pray that we get a handle on this, this climate stuff.
Um, yeah.
You know, so, alright, until next week.